The XP's Year-End Close Checklist: Giving Statements, Books and Payroll Before December 31

Oct 27, 2026

December has a way of arriving all at once. Giving peaks, staff bonuses come up, the board wants numbers, and a long list of year-end tasks lands on your desk. A little preparation in October and November can keep your year-end close from turning into a January scramble.

Here is a practical checklist, in the order most executive pastors need it (We have a PDF checklist for you below).

1. Get Your Giving Statements Ready

Donor statements are one of the most visible things your finance team produces each year. Mistakes here affect trust.

Clean up donor records now. Fix misspelled names and outdated addresses, and merge duplicates before the year ends, not after statements are printed.
Know what belongs on a statement. Include the date and amount of each gift. If a donor received goods or services in return, make sure you know what must be disclosed. Check with your accountant if you are unsure.
Set a cutoff rule. Decide how you will treat gifts that arrive by mail, online, or in the offering plate around December 31. Write the rule down so it is applied the same way every year.
Pick a send date. Aim to get statements out by late January, and tell your congregation when to expect them.

2. Plan for Non-Cash and Special Gifts

Year-end is when donors give stock, vehicles, and other property.

Decide who receives and records these gifts.
Make sure staff know what to say to a donor, and what not to say. The church acknowledges the gift. It generally does not set its value for the donor.
Put your policy in writing so the answer is the same no matter who takes the call.

3. Review Restricted and Designated Funds

Year-end giving often comes with a purpose attached, such as a building project, missions, or benevolence.

Review the year-end balance of every restricted and designated fund.
Confirm spending matched donor intent.
Check that December gifts are coded to the right fund.

Restricted funds are easy to mishandle and hard to untangle later.
For more, see Our Blog Don't Let Restricted & Designated Funds Derail Your Church's Vision.

4. Get Ahead on Payroll and Tax Prep

Bonuses and year-end pay. Decide on amounts early and make sure payroll processes them in the correct tax year.
Housing allowance. Make sure designations are documented for the coming year. Check out our post on What pastors need to know about the housing allowance is a good place to start.
Contractors vs. employees. Review anyone you pay as a contractor before 1099s are due. Our Contractor vs. Employee quick test can help.
Filing deadlines. W-2 and 1099 deadlines come quickly in January. See our Blog Stay Ahead of Payroll Tax Deadlines.

5. Close the Books Cleanly

A clean close makes your financial reports trustworthy.

Reconcile every bank and credit card account through December 31.
Clear outstanding check requests and expense reimbursements.
Make any needed accruals and adjustments so your year-end numbers are accurate.
Review your three core reports, and make sure you know what each one tells you:

6. Set Up the New Year

Your year-end close is also the starting point for next year.

Use your final numbers to ground next year's budget. If you need a framework, check out

Building a Church Budget Without Starting From Scratch, and download our free budgeting tool.

Schedule your first board financial report of the new year now, while you still have the time.

Need a hand? We created an XP Year-End Close Checklist below. Download and print the checklist, we hope you find it helpful!

You do not have to do all of this alone! If your team is stretched thin at year-end, Church Central Office provides outsourced accounting with a dedicated CFO, so your close is handled and your reports are board-ready. Contact us if you want more information.